The Court of Appeal sitting in Abuja has ordered both Rivers and Lagos states to maintain status quo on the collection of Value Added Tax, VAT, pending the determination of an appeal that was lodged before it by the Federal Inland Revenue Service (FIRS).
A three-man panel of justices of the appellate court led by Justice Haruna Tsammani gave the order to maintain the “status quo ante bellum” (to maintain the situation as it existed before) on Friday.
The order was given after the justices deferred the hearing of an application by Lagos State filed to be joined as an interested party in the matter, till September 16.
According to the appellate court, the order is to preserve the ‘Res’ (subject matter) of the appeal before it.
It specifically ordered all the parties that have subjected themselves before it to “refrain from taking any action to give effect to the judgement of the Rivers State High Court”, which gave Rivers State Government the right to collect VAT revenue, instead of the FIRS.
However, Lagos State had through its Attorney-General, Moyosore Onibanjo (SAN), protested against the issuance of an order for the maintenance of status quo, insisting that such order could not be binding on it, since it was yet to be joined as a party in the appeal by FIRS.
A Federal High Court sitting in Port Harcourt, Rivers State, had last month restrained the FIRS from collecting VAT and Personal Income Tax (PIT) following litigation instituted by the Rivers State government, ruling that the state should take charge of the collection.
Subsequently, the Rivers and Lagos houses of assembly passed domesticated VAT bills, which have been signed into law by governors Nyesom Wike and Babajide Sanwo-Olu respectively.